The May Nymex contract rallied 5.7 cents to settle Monday at$2.409, thanks to what sources said was good peak demand buying inthe physical market. “There was definitely some peak airconditioning demand in Texas today, and that’s exactly where youwant to see it to influence natural gas prices,” one of the sourcessaid. Buoyed by that strength, May had no problem rising from itsopening trade of $2.345, which also turned out to be its low pricefor the day.

One Chicago based marketer feels that if activity in his part ofthe country are any indication, then the road to higher futuresprices may just run through the Midwest. “Chicago ran up today insympathy with the screen and in doing so gave the May contract thego-ahead to test the $2.46 level tomorrow. That is the life ofcontract high and sellers will step out into the market to beat Mayback down but the money flowing into the market on the part of thefunds and the locals will win over the sellers and we should pushthrough the 2.46 level if not tomorrow, then this week,” hepredicted.

His intermediate outlook is also bullish, but he remainsconservative in the long run. “I look for higher prices for thenext 90 days as people concentrate on injections and have a clearrecollect of paying $3.-something for their gas late last summer.However, as people try to avoid the higher prices of last latesummer-fall, they could be setting the market up for a bid fall bymid-summer,” he said.

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